CAN-SPAM Act – Part II

So, now that we know more about preemption in the CAN-SPAM Act, then what more is there to consider? There is actually quite a lot of other factors, namely standing. Now that you know how the federal CAN-SPAM Act and state laws may interact, there leaves the question of “standing.” Standing is essentially a way for individuals to claim that they can sue under the law. Without standing, a lawsuit cannot occur. So, can you sue as an individual under the law? Can you sue as a business? Who can sue?

Can an individual sue under CAN-SPAM?

In general, individuals likely cannot sue under this federal law. We can revisit the case of Gordon v. Virtumundo where the plaintiff had setup a business to profit off of violations of anti-spam legislation. He was a Verizon subscriber for his internet access, and had started his business through GoDaddy. In the trial, the court revisited the standing provisions of the CAN-SPAM Act and made three determinations. First, the federal statute was not made to stamp out all spam. Second, it was not specifically implemented to allow private right of actions. Third, plaintiff had not suffered adverse effects due to spam.

There are some businesses that would be able to sue under this law. The court singles out Internet Service Providers, which provide some type of online service (e.g., GoDaddy, Verizon) towards customers. Those that provide the service as a sort of third party, would not necessarily qualify, but may have a better argument due to size or scale.

On the note of adverse affects, the court deemed that Gordon’s business was clearly not adversely affected by the submission of spam to his inbox due to his business operations. In Asis Internet Services v. Azoogle.com, while the argument was perhaps a better one on the facts, the court found that the cost of carrying the spam emails, filtering them through, and adding server space was not sufficiently adverse towards plaintiff. Rather, it was something expected of a service provider, so there was no sufficient damage.

Who can sue under CAN-SPAM?

The legislation is particularly clear on that end. The individuals that can initiate a lawsuit under CAN-SPAM are Internet Access Providers that are adversely affected, Federal Trade Commission, state attorney generals and state and federal agencies. Of the agencies and entities, they include the Security and Exchange Commission, Board of National Credit Union Administration, Secretary of Transportation, and Secretary of Agriculture. This is admittedly a very narrow group that can claim some sort of damage and initiate a lawsuit. However, as stated above, Congress appears to have drafted it with that limitation in mind.

While there is no hard set definition of an internet access provider, Gordon signals that certain business types, like Verizon, which provides internet access, and GoDaddy, which hosts domain names and websites, would be closer to a definition of an internet access provider than a smaller provider that uses those services to start its own.
At our law firm, we assist clients with legal issues related to business, technology, and e-commerce transactions. You may contact us to set up an initial consultation.